Antonio and Barbara are partners who share income in the ratio of 1:2 and have capital balances of $40,000 and $70,000, respectively, at the time they decide to terminate the partnership. After all noncash assets are sold and all liabilities are paid, there is a cash balance of $80,000. What amount of loss on realization should be allocated to Barbara?

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The total capital is $110,000 ($40,000 + $70,000). After realization, the cash balance is $80,000, indicating a loss of $30,000 ($110,000 - $80,000). Barbara's share of the loss is 2/3 of $30,000, which is $20,000.

Antonio and Barbara Are Partners Who Share Income in the Ratio